Air Arabia pushes Gulf budget airline model

27th Jun 2007

The aviation market in Middle East is poised for significant, sustained growth, said the Chief Executive Officer of Air Arabia, the first and largest low-cost carrier in the Middle East and North Africa.
Recently speaking at the fourth annual India and Middle East Low-Cost Carrier Symposium in Mumbai, India, Adel Ali pointed to the projected increase in the Middle East’s share of global tourism to 4.4 per cent by 2020, and said that the Middle East will lead world passenger traffic growth, with current travel demand up 18 per cent.

The Air Arabia CEO and Board Member said: ‘With three major emerging markets - including China, India and the CIS countries - located right in our backyard, the Middle East is perfectly placed to meet the needs of travelers across this wider region. Each of these areas is currently experiencing sustained increases in passenger traffic, and the Middle East can become the hub for this vast swath of the globe.’

He continued: ‘The growth opportunities for the Middle East aviation market are not only linked to geography, however; the sector’s expansion is also being driven by deregulation and liberalisation, by economic diversification and sustained growth, and by the region’s demographics, including the very large expatriate populations in the Gulf states. All of these factors contribute to the incredible success story taking place here, which has also made the Middle East, one of the fastest-growing region in the world in terms of tourism arrivals.’

Pointing to the outlook for the low-cost carrier (LCC) segment in particular, Ali said: ‘While demand is increasing across the sector, the outlook for LCCs is especially bright. Consider that, in North America, LCCs market penetration rate account for roughly 25 per cent of market share; here in the Middle East, LCCs make up just 0.1 per cent of the market. Air Arabia has been able to successfully introduce the LCC model to the region and customise it to meet the needs of travelers here. As a result, regional perceptions of LCCs are changing fast.’

He concluded: ‘Looking at our geographic advantage, the strength of the region’s economies and the demographic trends - today, it is clear that the LCC segment here is poised for takeoff. By meeting the unique needs of customers in the region, Middle East-based low-cost carries can make a huge contribution to both the travel industry and the growth of the region as a whole.’

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About Air Arabia: Air Arabia was established in February 2003 by an Amiri decree issued by His Highness Dr. Sheikh Sultan Bin Mohamed Al Qassimi, Ruler of Sharjah and Member of the Supreme Council of the United Arab Emirates. The company began operations in October of the same year.

Air Arabia is modeled after leading American and European low-cost airlines and is customised to local preferences. Its main focus is to make air travel more convenient through Internet booking and offering the lowest fares in the market without sacrificing on service or safety standards. ——-